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SOUTH AFRICA
Deal Maker of the Year Awards 2013 WINNER - BOWMAN GILFILLAN AFRICA GROUP
DEAL: PPC’s Zimbabwean indigenisation transaction
NAME: Charles Douglas & Unathi Kondile COMPANY: Bowman Gilfillan Africa Group POSITION: Partners WEBSITE: www.bowman.co.za
PARTNER PROFILES Charles Douglas
Partner Charles is a partner in Bowman Gilfillan’s corporate department specialising in mergers and acquisitions and capital markets work.
Charles’ M&A experience includes both public and private transactional work, having advised clients such as Barloworld, Eaton Corporation, Kansai Plascon, Metorex, Pioneer Hi-Bred (a Du Pont subsidiary), PPC, Resource Generation, SABMiller, Sasol, ThyssenKrupp Engineering and Unisys Corporation. From a capital markets perspective, Charles has experience with both primary and secondary offerings as well as more general listings work. Charles has assisted clients with black economic empowerment transactions and more general regulatory advice (including governance, energy, mining and pharmaceutical regulatory work).
In addition to South African work, Charles has experience working in various other African jurisdictions, including Botswana, the DRC, Mauritius, Namibia, Tanzania, Zambia and Zimbabwe. Charles also has 18 months’ work experience in Sydney, Australia and is admitted as a lawyer of the Supreme Court of New South Wales. In 2012, Charles was named in the Mail & Guardian’s list of top 200 young South Africans and, in 2013, as one of the 49 DHL ‘Rising Star’ finalists.
Unathi Kondile
Partner Unathi is a partner in Bowman Gilfillan’s corporate department specialising in mergers and acquisitions and general corporate and commercial law.
Recent transactions that Unathi advised on include: • Advised on the Bharti proposed merger with MTN (deal value R200 billion); • Advised Verizon Communications, one of the 2 largest telecommunications companies in the United States in the recent disposal by its wholly owned subsidiary, Verizon European Holdings Limited to MTN of its entire shareholding in Verizon South Africa (Pty) Limited;
• Advised Transnet on the privatisation and restructuring of state assets and the disposal of certain non-core assets ;
• Advised Telkom with regard to its sale of Telkom Media and its acquisition of MWEB Africa (deal value R800 million) ;
• Advised JSE listed Freeworld Coatings and its majority shareholder, Kansai Paint Co., in relation to the proposed delisting of Freeworld Coatings from the JSE and associated scheme of arrangement, valued at approximately R185 million, announced on 18 October 2011;
• Advised developers in respect of bid submissions under the South African Government’s renewable energy independent power producer programme leading to the success of a number of the bids submitted ;
• Advising PPC, the largest producer and supplier of cement products in Africa, in respect of its R1.1b second BEE transaction, announced in July 2012.
DEAL OVERVIEW In order to comply with the requirements of
the Zimbabwe Indigenisation and Economic Empowerment Act, (PHL),
Portland Holdings Limited, a wholly owned subsidiary of PPC Ltd
(which is listed on the JSE and the ZSE), disposed of approximately 29.6% of PHL’s shareholding to indigenous Zimbabweans including a broad based community trust, employees of PHL, certain non-executive directors of PHL and the National Indigenous and Economic Empowerment Fund. The transaction was facilitated through a notional vendor funding mechanism.
With the support of local counsel, our role was that of the primary legal advisors, advising on deal structuring, contract negotiations and providing strategic input.
Transactions of this nature, which are driven by a broader government imperative, require more than black letter lawyering. They also require, amongst other things, strategic consideration around key stakeholder engagement and
sensitivity towards
domestic issues. At a time when many investors in Zimbabwe would prefer to do the bare minimum in relation to indigenisation, PPC boldly committed to more than the letter of the law, which appears to have been well received and to have assisted its business in the country.
Bowman Gilfillan Africa Group, which is expanding its presence in Africa and now has offices in Cape Town, Dar es Salaam, Gaborone, Johannesburg, Kampala and Nairobi, is well poised to assist clients operating on the continent. From a South Africa perspective, we are increasingly assisting our clients traditionally based here with their expansion north in various capacities, including mergers and acquisitions, construction and infrastructure as well as in the context of compliance with local requirements, as was the case in the PPC transaction. Strategic and nimble advice is key to adding value to clients in this context.